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I'm not convinced this novel idea would work in practice, but the investment banking industry should be disrupted. Too many Harvard grads being paid too much m

I'm not convinced this novel idea would work in practice, but the investment banking industry should be disrupted. Too many Harvard grads being paid too much money to work too many hours to add too little societal value.

tehlike 9y ago
a good majority of startups fall in to this bucket.
jstanley 9y ago
You don't get to decide how much "societal value" a job adds. Society decides, by paying for it. It's likely that the investment banking industry adds a lot more value than you think it does, else where does the money come from?
- JSONwebtoken 9y ago
  Society also pays the Realtor 6% and the sports betting website 10%. Just because a transaction has historically occurred at a given price doesn't mean it should continue to be worth that much in the modern services market. Accounting and law firms shouldn't be worried about automation just yet when frat stars are still being paid $140k/yr out of college to make powerpoint presentations.
  - gaius 9y ago
    You're right - they should be working on new ways to show ads and steal personal data - that's REAL value for society! Glass houses, stones and all that...
- Nursie 9y ago
  Of course you do - you can recognise that (for instance) carers add a lot of value to society, making little money while each making a huge impact on a small number of people. And you can recognise that a lot of people make a lot of money from doing things so abstracted from every day life, nobody would be the wiser if they just popped out of existence one day.
  - jstanley 9y ago
    Carers add a lot of value as a group, and are compensated heavily as a group, but any individual carer does not add very much value because they can only care for so many people.
    - Nursie 9y ago
      Sure, I agree. However the people who make a ton of money juggling arcane financial instruments... societal value and financial recompense are somewhat removed from each other is all I'm saying. An imperfect fit.
  - DanBC 9y ago
    An off topic nitpick: In the UK strictly speaking carers by definition are not paid. People often say "carer" when they mean "care worker". This is important because care workers have legal rights which are often ignored, and because carers are often not identified (and thus don't receive the statutory help they're entitled to) because people think "carer" means "paid employee".
    - Nursie 9y ago
      Oh fair enough, I shall try to keep that in mind. I do use the terms interchangeably and that's probably not helpful.
- kazagistar 9y ago
  If we all had the same purchazing power, then you would be right. But how much you get paid is not determined by how much societal value you add, but how much value you add to existing pools of capital. The money is in making the rich get richer.
- moxious 9y ago
  > Society decides, by paying for it. This works nicely, in theory, in the absence of market distortions and coercive forces. In practice, both of those things do exist, and so markets don't work entirely like theory predicts. Classical economics doesn't adjust itself for things like regulatory capture, corruption, bundling of services, and a host of other factors that are likely at play in investment banking. It shows far too much faith in the workings of the system to claim that society is deeming investment banking of high social value because it pays a lot.
- CPLX 9y ago
  > It's likely that the investment banking industry adds a lot more value than you think it does, else where does the money come from? The same place Mobutu and Ferdinand Marcos's billions come from. The logical leap you're attempting here is profoundly unsound.
  - bbctol 9y ago
    On the docks in 1776: You don't get to decide how much "societal value" King George adds. Society decides, by paying for it. If he wasn't adding so much value, why would we be sending him so much money? I swear, I didn't consider myself that far left, but it's unreal how religious the concept of the market has become.
- paulgb 9y ago
  Economic rent
- stale2002 9y ago
  And if those people get replaced, then something else is providing that value for cheaper. We are arguing that these people can, and should be replaced with something much cheaper and better.

tehlike 9y ago

a good majority of startups fall in to this bucket.

jstanley 9y ago

You don't get to decide how much "societal value" a job adds. Society decides, by paying for it. It's likely that the investment banking industry adds a lot more value than you think it does, else where does the money come from?

JSONwebtoken 9y ago
Society also pays the Realtor 6% and the sports betting website 10%. Just because a transaction has historically occurred at a given price doesn't mean it should continue to be worth that much in the modern services market. Accounting and law firms shouldn't be worried about automation just yet when frat stars are still being paid $140k/yr out of college to make powerpoint presentations.
- gaius 9y ago
  You're right - they should be working on new ways to show ads and steal personal data - that's REAL value for society! Glass houses, stones and all that...
Nursie 9y ago
Of course you do - you can recognise that (for instance) carers add a lot of value to society, making little money while each making a huge impact on a small number of people. And you can recognise that a lot of people make a lot of money from doing things so abstracted from every day life, nobody would be the wiser if they just popped out of existence one day.
- jstanley 9y ago
  Carers add a lot of value as a group, and are compensated heavily as a group, but any individual carer does not add very much value because they can only care for so many people.
  - Nursie 9y ago
    Sure, I agree. However the people who make a ton of money juggling arcane financial instruments... societal value and financial recompense are somewhat removed from each other is all I'm saying. An imperfect fit.
- DanBC 9y ago
  An off topic nitpick: In the UK strictly speaking carers by definition are not paid. People often say "carer" when they mean "care worker". This is important because care workers have legal rights which are often ignored, and because carers are often not identified (and thus don't receive the statutory help they're entitled to) because people think "carer" means "paid employee".
  - Nursie 9y ago
    Oh fair enough, I shall try to keep that in mind. I do use the terms interchangeably and that's probably not helpful.
kazagistar 9y ago
If we all had the same purchazing power, then you would be right. But how much you get paid is not determined by how much societal value you add, but how much value you add to existing pools of capital. The money is in making the rich get richer.
moxious 9y ago
> Society decides, by paying for it. This works nicely, in theory, in the absence of market distortions and coercive forces. In practice, both of those things do exist, and so markets don't work entirely like theory predicts. Classical economics doesn't adjust itself for things like regulatory capture, corruption, bundling of services, and a host of other factors that are likely at play in investment banking. It shows far too much faith in the workings of the system to claim that society is deeming investment banking of high social value because it pays a lot.
CPLX 9y ago
> It's likely that the investment banking industry adds a lot more value than you think it does, else where does the money come from? The same place Mobutu and Ferdinand Marcos's billions come from. The logical leap you're attempting here is profoundly unsound.
- bbctol 9y ago
  On the docks in 1776: You don't get to decide how much "societal value" King George adds. Society decides, by paying for it. If he wasn't adding so much value, why would we be sending him so much money? I swear, I didn't consider myself that far left, but it's unreal how religious the concept of the market has become.
paulgb 9y ago
Economic rent
stale2002 9y ago
And if those people get replaced, then something else is providing that value for cheaper. We are arguing that these people can, and should be replaced with something much cheaper and better.